30 Year Fixed Rate Mortgage

The thing we always preach is the importance of knowing every single thing involving your mortgage. Today we are going to get a bit more specific. The following are some of the advantages and disadvantages of a 30 year fixed rate mortgage. This is often the mortgage of choice for many people. So let�s figure out why that is. Getting all the important information is what can help you make the best decision possible on a mortgage that works for you.

Advantages of a 30 Year Fixed Rate

• One of the best advantages of this fixed rate mortgage is that it offers people the opportunity to have a mortgage they can pay off on the long term. It allows for more financial flexibility.
• Because this is a fixed rate, you know you will be paying the same interest rate for the entire 30 year period.
• The monthly payments are lower on a 30 year fixed rate mortgage because the interest on this loan occurs over a longer period of time.
• You can use these lower payments to help you with other needs around the house. Home improvements are a great thing for a house.
• Because of the interest bill that comes, it helps you increase the amount consumers will be able to deduct at tax time.

Disadvantages of a 30 Year Fixed Rate

• You will probably have to pay higher interest rates on these loans then you would on a 15 year loan.
• You are now on the hook for a long mortgage. Know that it will not be a sprint, but a marathon. So keep track of it and do not fall behind.
• You also are set up to earn equity at a slower pace then normal. Your first payments will generally go towards interest before you even get to the principal part of the payment.

So now you know some of the advantages and disadvantages of a 30 year fixed rate mortgage. You must consider everything about your possible mortgage before you pull the trigger. You will be stuck with this mortgage for a while, so you do not want to make a bad decision.